In conversation with Tom Stoyle, Senior Contingency Underwriter, we discuss how the events industry has bounced back from the pandemic, the team’s ambitions and how Arch is positioning itself in the market and supporting its insureds as the risk landscape continues to evolve.
What stage has the Contingency market reached in terms of bouncing back from the impact of the pandemic?
In terms of new business, the Contingency market is truly on the road to recovery, with enquiry levels nearly back to pre-pandemic levels. 2022 has been a really positive year for the events industry, with very limited government shutdowns globally due to COVID-19, allowing events to go ahead as planned. We expect the Contingency market will exceed pre COVID-19 levels within the next 12 months, and we’ll see a continued rate of growth from there onwards.
How has the rate of recovery varied for different insureds?
Certain event types have been able to adapt following the impact of the pandemic. Conference and exhibition organisers were ahead of the curve as they were able to hold events virtually, so were the first event type to come back, although in person attendance at these events has been a little slower due to some reluctance still of businesses and individuals to travel. For mass attendance events such as festivals and concerts, whilst it has taken more time for event organisers and local and national authorities to become sufficiently comfortable with COVID-19 guidelines and holding events safely, it has been really positive to see in 2022 that attendance numbers have increased from pre-pandemic levels.
How is the risk landscape evolving for insureds and how is Arch responding to ensure clients have the most appropriate coverage?
Risk management is fundamental for event organisers. Existing risks such as adverse weather, climate change and natural catastrophes continue to evolve. Hurricane Ian is a recent example of the devastating impact for event organisers. The event, which is estimated to cost the insurance industry between $30-$60bn, forced many organisers who were holding events in, or within proximity of the storm’s path, to cancel over safety concerns.
Emerging risks such as cyber and virtual transmission are examples of more recent perils which organisers face. It is important that event organisers mitigate against these exposures, and one way to do so is to purchase an event cancellation insurance product to transfer the risk.
Inflation is playing a key part in insureds’ overall risk profile. Certain costs such as fuel and energy can increase in the period between when an insurance policy is purchased and when the event takes place which could result in under insurance. This is a challenge for insureds, but we work closely with them to make sure that they have adequate cover in place to give sufficient protection and peace of mind in the event of a claim.
“Our approach to doing business is built on our commitment to providing a superior service, delivered by a team of highly experienced and empowered underwriters. With strong technical expertise and a data-driven focus, we’re able to underwrite risks more accurately and work collaboratively with our brokers to provide a more tailored client offering.”
TOM STOYLE, senior CONTINGENCY underwriter
How would you describe current Contingency market dynamics, and how is Arch positioning itself in that market?
Following a prolonged soft market period which preceded two years of substantial losses from COVID-19, there have naturally been markets who have exited the class. Some existing markets have also reduced appetite and line size as carriers reflected on circa $3bn of losses attributable to the Lloyd’s Contingency market. We are now experiencing the best market conditions since 2001.
Chris Rackliffe, who’s been a Contingency market lead for over 25 years, joined Arch in 2021 as Head of Contingency and Accident & Health, as did Claire Atley, Senior Underwriter. This showed a strong statement of intent by Arch to establish itself as a market leader.
Our approach to doing business is built on our commitment to providing a superior service, delivered by a team of highly experienced and empowered underwriters. With strong technical expertise and a data-driven focus, we’re able to underwrite risks more accurately and work collaboratively with our brokers to provide a more tailored client offering.
In terms of Arch’s growth ambitions, are there any specific areas you will be targeting over the next 12 months?
We have a very strong presence in the event cancellation market. We have set up a Consortium to better serve our clients and brokers on that front, which enables us to deploy a line size of up to $50 million. We will continue to explore growth opportunities in this sector.
Our book is global and our coverage remit is very extensive, spanning areas including non-appearance, standalone terrorism for events, prize indemnity, TV transmission failure cover for live or virtual events, event liability and some film and commercial production. We are continually analysing opportunities across all these sectors and looking to capitalise on market developments where we see the potential for sustainable growth and where we can further enhance the levels of service we are able to provide.
What three words would you use to describe the Arch Contingency team?
Dynamic, Empowered, Commercial.
What drew you to Arch?
I jumped at the opportunity to join Arch, it’s an organisation which has a very exciting future. Senior management has a very positive attitude towards risk and is willing to embrace opportunities when they arise. I am extremely proud of what the team has achieved in such a short space of time.
What would your dream job outside of insurance be?
I’m an avid golfer, so my dream job outside of insurance would be playing on either the DP or PGA Tour. I’m more of a traditionalist and prefer the 72-hole format so unfortunately for Greg Norman, I wouldn’t be a name on his roster.